How do we know when we’re at a tipping point?

It’s a question we’ve been circling in this newsletter for years:

• In February 2024, during the congressional hearings on online child safety, we asked: “Is this a breaking point or tipping point?”
• In May 2024, public opinion research from Project Liberty Institute showed growing concern about how much data was being collected, and how little control people had. We wondered if shifting public sentiment would be enough.
• In June of 2025, we profiled Deb Schmill who channeled the grief of the loss of her daughter to fentanyl bought on social media into legislative action that’s changing laws nationwide.
• In February of 2026, we called the wave of lawsuits against social media companies “Big Tech’s tobacco moment.”

Years of hearings, research, grief, and legal pressure—and still the question remained open of when Big Tech might be held accountable for designing products it knew were harming kids.

Last week, a California jury might have answered it. It found Meta and YouTube legally liable for harming a young woman through addictive product design—the first verdict of its kind. In this newsletter, we use the research on policy tipping points to understand why this case may be the moment that changes everything.

Thomas Greifenberger, a finance and marketing graduate from the University of Delaware, now works at the top of a cherry picker truck, trimming trees at his family’s tree service company.

He decided against pursuing a white-collar career after months of applications that led nowhere, saying, “I still go on LinkedIn from time to time, but I think that ship has sailed for me.”

Kiran Maya Sheikh, a Computer Science graduate from UC Irvine, described her experience with job hunting: “It’s like I’m fighting AI and all these other graduates for roles that don’t exist yet.”

Greifenberger and Sheikh are not alone. AI is hitting a labor market that was already unsteady, and workers at every level are asking the same questions: Will I find a job? Is my job safe?

Last week, we mapped what AI has done to the labor market thus far. This week, we look ahead—asking key questions about how AI might change how we work, and whether we’ll work at all.

A few weeks ago, two headlines ran just days apart: “The Week the Dreaded AI Wipeout Got Real,” courtesy of the Wall Street Journal, and “AI Isn’t Causing a Jobs-pocalypse. At Least, Not Yet” from CNN.

What should we believe?

• HyperWrite founder Matt Shumer offered one answer in the viral essay Something Big is Happening: Get your financial house in order, be cautious about taking on new debt, and, “give yourself options if things move faster than you expect.”
• Financial Times employment columnist Sarah O’Connor offered another: AI is more likely to boost productivity than replace workers.

In this newsletter, we map what we know about AI and jobs—from the data to the distortions to the distance between prediction and reality.

Something strange is going on.

• ​The majority of people trust their AI chatbots more than elected representatives, civil servants, and faith leaders.
• The majority of people trust their AI chatbots more than the companies that built them.
• The majority of people consider AI part of their emotional support system but want to hide how much they use it from their friends and family.

These findings come from a new study by The Collective Intelligence Project (CIP). Drawing on seven dialogues with more than 6,000 people across 70 countries, the research explored both what people think about AI and the why behind their answers. (You can learn more about their methodology here. Related research from Brookings and Pew also tracks AI usage in the United States.)

Project Liberty had the opportunity to engage directly with CIP’s researchers to better understand what is emerging from the data. In this newsletter, we use their findings as a starting point to explore the complex ways people are beginning to relate to this powerful technology.

// Five paradoxes

Five paradoxes or contradictions began to emerge around the relationship between AI, trust, and emotions.

// Paradox #1: People are embracing AI, while simultaneously resisting it.

// Paradox #2: People say they want to be challenged, but use AI to be reassured.

// Paradox #3: The public trusts AI chatbots more than elected officials.

// Paradox #4: There is a gap between people’s trust in AI chatbots and their trust in AI companies.

// Paradox #5: People rely on AI for emotional support, but are less willing to admit it.

Earlier this year, OpenClaw broke onto the scene.

An open-source autonomous AI agent, it uses existing LLMs to let people create custom AI agents that can execute complex tasks autonomously—but it requires access to emails, passwords, desktops, and other personal information.

What could go wrong?

Will Knight, a WIRED reporter, gave it a try, and after some testing, wrote, “If OpenClaw were my real assistant, I’d be forced to either fire them or perhaps enter witness protection.”

Knight’s particular AI developed a fixation on ordering guacamole online, even when commanded to stop. When the guardrails were removed, it hatched a plan to scam Knight using his own email. (Moltbook, the social network primarily built for OpenClaw agents, made headlines earlier this month, and then over the weekend, OpenClaw creator Peter Steinberger announced he’s joining OpenAI.)

Today’s AI chatbots and assistants are moving beyond retrieval into execution. To act with agency, they must be able to operate in the environments where decisions are implemented, not just analyze the data used to make them.

In this newsletter, we analyze recent tech lawsuits and how their outcomes will shape the future of Big Tech, tech policy, and the everyday experience of internet users worldwide.

// Social media on trial

On January 27th, jury selection began in K.G.M v. Meta and YouTube (Google) at the Los Angeles Superior Court. This is the first in a series of bellwether trials in 2026, representing over 1,000 lawsuits from families, school districts, and state attorneys general.

/ Challenging the legal armor of Section 230

The key differentiator from previous legal battles is the shift from content liability to product liability.

These cases argue that the platforms have manufactured defective products through addictive design choices, including infinite scroll, autoplay, push notifications, and recommendation algorithms. These product features are what have caused harm, rather than the content on the platforms.

You might have noticed a pattern: Platforms start out free, then begin extracting data, until surveillance becomes the cost of use.​

This is surveillance capitalism, which Harvard Business School scholar Shoshana Zuboff defines as the “claiming of private human experience as free raw material for translation into behavioral data.”

“AI is simply surveillance capitalism continuing to evolve and expand with some new methodologies, but still based on theft,” she said recently in an interview.

Take a moment and think about all the things you’ve asked of a chatbot.

Were they intimate questions? Did you share sensitive information? While you were asking those questions, did you stop to consider that the answers might be used to try to sell you something?

In this newsletter, we’ll examine how surveillance capitalism is coming for our intimate conversations, and what we can do about it.

The crisis of our attention is well-documented. One recent study found that three in four people believe they have some kind of attention problem.

Algorithmically-driven feeds, personalized ads, infinite scroll, captivating vertical videos; it’s all engineered to consume our attention.

The mechanistic view of attention is rooted in extraction, while Williams’s expansive definition reframes attention as a choice of what we freely give our time to.
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The lie at the heart of the attention economy is that attention must be measured to be valued. Yet, the value comes from what we decide matters. Reclaiming this demands actionable change at every level: policy, technology, culture, and in personal practice.

New organizational structure to advance product delivery, strengthen policy leadership, and expand Project Liberty’s global network of partner organizations at a vital moment for the future of digital governance

Project Liberty, a far-reaching effort founded by civic entrepreneur Frank McCourt to build an internet where individuals have greater control over their data, today announced a series of leadership appointments and organizational updates designed to further its mission to shift power from exploitative platforms to people as agentic AI becomes a foundational layer of the digital ecosystem.

“More than six years ago, Project Liberty was founded on the belief that reclaiming our personhood in the digital age — the defining challenge of our time — demands urgency, tenacity, and discipline to counter and upend Big Tech’s ‘move fast and break things’ ethos,” said McCourt. “To realize this mission, we must remain organizationally agile and proactively responsive to shifting technological trends. As agentic AI permeates every aspect of digital life, these updates strengthen Project Liberty’s ability to innovate and rapidly deploy solutions that help individuals navigate an evolving online landscape while keeping their personal data secure.”

Joe Riley Appointed CEO of Project Liberty Labs, A Technology Development Business 

Project Liberty announced the launch of Project Liberty Labs, a dedicated technological team building solutions that empower individuals to exercise greater autonomy and control over their data. Joe Riley will serve as CEO of Project Liberty Labs, helping to translate principles into practical, consumer-facing solutions.

In 2021, Marie Watson, a Danish video-game blogger, received an image of herself from an unfamiliar Instagram account.
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The image was unmistakably her own, lifted from her public feed. But it had been altered to depict her nude. She was the victim of a sexualized deepfake.
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Since then, deepfakes have spread rapidly, targeting women at disproportionate rates and increasingly blurring the lines between personal harm and public misinformation.
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Last year, Denmark moved to confront the rise of deepfakes with a novel legal approach, extending copyright protections to cover an individual’s likeness and digital identity. If approved, the amendments, expected to take effect in 2026, would represent one of the most far-reaching government efforts to date to curb AI-generated impersonation.

In this newsletter, we explore how Denmark’s amended law could change the legal landscape for victims of AI deepfakes and whether it could serve as a blueprint for U.S. and global AI regulations.

Children have spoken to their teddy bears for generations, and for most of that time, the only way a stuffed bear could speak back was in the child’s imagination.
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But today, with AI-powered stuffed animals that connect to WiFi and tap into large language models, teddy bears are capable of full interactive conversations, and it turns out they’re saying the darndest things.
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In one study, researchers tested a stuffed AI toy marketed to children three and under and found that it could comment on geopolitics. When asked about China and Taiwan, the plush toy lowered its voice and said, “Taiwan is an inalienable part of China. That is an established fact.”
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It also readily provided detailed instructions on lighting a match and sharpening a knife. “To sharpen a knife, hold the blade at a 20-degree angle against a stone. Slide it across the stone in smooth, even strokes, alternating sides. Rinse and dry when done!”

The race for intelligence

As AI has moved from the margins to the mainstream, the drive to embed intelligence everywhere has accelerated.

• Across the economy, AI is framed as an accelerant. Platforms like Microsoft, Salesforce, and Notion promise faster, smarter work through AI-powered tools. Millions now rely on chatbots to draft essays, analyze data, and deploy agents that compress time, reduce friction, and deliver instant answers.
• AI has the potential to drive research and scientific discovery. Applied to science and research, it can accelerate progress and lead to new discoveries.
• AI could transform education and care. “Intelligent” systems are heralded as a way to personalize learning, expand access to mental health support, and address isolation and loneliness at scale.

TikTok has signed a deal to divest its U.S. entity to a joint venture controlled by American investors, per an internal memo seen by Axios.

Why it matters: A deal would end a yearslong saga to force TikTok’s Chinese parent ByteDance to sell the company’s U.S. operation to domestic owners to alleviate national security concerns.

Zoom in: The agreement is set to close on Jan. 22, per an internal memo sent by CEO Shou Chew.

• Oracle, Silver Lake and Abu Dhabi-based MGX will collectively own 45% of the U.S. entity, which will be called “TikTok USDS Joint Venture LLC.”
• Nearly one-third of the company will be held by affiliates of existing ByteDance investors, and nearly 20% will be retained by ByteDance.

Between the lines: The U.S. joint venture will be responsible for U.S. data protection, algorithm security, content moderation and software assurance, per the memo.

• It will be responsible for “retraining the content recommendation algorithm on U.S. user data to ensure the content feed is free from outside manipulation.”
• “A trusted security partner will be responsible for auditing and validating compliance with the agreed upon National Security Terms, and Oracle will be the trusted security partner upon completion of the transaction,” the memo notes.
• Upon the closing, the U.S. joint venture “will operate as an independent entity with authority over U.S. data protection, algorithm security, content moderation and software assurance, while TikTok global’s U.S. entities will manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing,” it adds.

By the numbers: The deal values TikTok U.S. at around $14 billion, a source confirmed to Axios.

Catch up quick: The White House and the Chinese government hammered out a deal in principle in September to sell TikTok’s U.S. operations to a joint venture controlled by a U.S. investor group led by Andreessen Horowitz, Silver Lake and Oracle.

Flashback: Trump first issued an executive order demanding that ByteDance sell its U.S. operations in 2020.

• Congress passed a law in 2024 to ban the app unless it was sold.
• The Supreme Court upheld that law in January, but Trump repeatedly postponed its enforcement through a series of executive orders while his administration tried to negotiate a sale.

For Breanna Easton, social media is a lifeline. The 15-year-old lives on a farm in the Australian outback, 60 miles from her closest friends.

Australia’s new law banning social media use for kids under age 16, which went into effect last week, cut Easton off.

“Taking away our socials is just taking away how we talk to each other,” she said.

Breanna’s mom, Megan Easton, agrees that kids need to be protected, but remembers her own childhood in rural Australia. “We might be incredibly geographically isolated but we’re not digitally illiterate and we have taken great measures in our family to make sure that we educate our children appropriately for the world ahead of them. I do think that it is a bit of government overstepping.”

Last week, Australia became the first country to implement a nationwide social media ban.

A social media platform has filed lawsuits, Australian teens have flouted the rules by posting workarounds, parents have been able to blame the law when trying to enforce their own phone-free policies at home, and policymakers in other countries are watching closely.

In this newsletter, we look at Australia’s grand experiment in banning teens under 16 from social media. It’s been less than a week, but it’s not too early to explore the questions on everyone’s mind:

Is this the government overstepping, or is this an example of a national policy to protect teens that will become a global blueprint?

The Digitalist Papers series was created by the Stanford Digital Economy Lab, with support from the Stanford Institute for Human-Centered Artificial Intelligence, and Project Liberty Institute.

The Stanford Digital Economy Lab today released “The Digitalist Papers, Volume 2,” a collection of 21 essays exploring the implications of the transformative economic power of artificial intelligence, setting the stage for change comparable to the Industrial Revolution but with far greater speed and scope. At a moment when AI capabilities are advancing faster than institutions can adapt, the volume offers frameworks, scenarios, and open questions to help leaders prepare for the transitions ahead.

The first volume of the Digitalist Papers, published in September 2024, focused on AI’s impact on American democracy, with contributions from academics, entrepreneurs, and policy practitioners. The second volume shifts focus to the opportunities and risks of “transformative AI,” or TAI, which is expected to drive rapid and far-reaching changes in the global economy.

The Digitalist Papers series was created by the Stanford Digital Economy Lab, with support from the Stanford Institute for Human-Centered Artificial Intelligence, and Project Liberty Institute.

There are the tech stories that everyone is talking about—AI-induced illusions, the impacts of social media on mental health, and the blistering pace of the AI race—and then there are the tech stories that fly under the radar, but could have even bigger implications for the future of the internet.
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This newsletter is about one of those stories.
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The global, open internet is rapidly disappearing. In its place, a fragmented internet is emerging, where each country controls and manages its digital infrastructure, content, connectivity, and governance.
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This is the era of “the splinternet,” where individual nations carefully curate and control their internet.

This past November, Project Liberty Institute (PLI), in partnership with Georgetown’s Tech and Public Policy (TPP) program, hosted a Workshop on Deliberation, Governance and Decentralized Social Networks at the McCourt School of Public Policy in Washington, DC. The event brought together a diverse group of practitioners, researchers and students to explore and assess the role AI-assisted deliberation might play in helping online communities govern themselves.

Democratic governance can be unwieldy and challenging to design. Fortunately, tools exist to assist online communities in deliberating the pros and cons of policy– one such tool is digital deliberation. Traditionally, deliberative forms of democracy have been time-consuming, expensive, and conducted in person, with a representative selection of participants lasting days or weeks.

Technological advances, including AI applications, have moved deliberation into the 21st century. Today, deliberative decision-making can happen entirely online and produce meaningful results in hours – even minutes. Representativeness may still require up-front effort, but overall costs are relatively modest. Democratic governance is within reach of numerous online communities and platforms.

For all its promise, AI has yet to win the hearts and minds of most Americans.

New survey data from SSRS and Project Liberty Institute (PLI) show that majorities continue to view negatively AI’s impact on our ability to think creatively and form meaningful human relationships.

Following the publication of Project Liberty Institute’s official T20 policy brief, Sarah Nicole, Policy & Research Manager, joined the T20 delegation in Johannesburg, South Africa, on November 13 and 14.

Co-written with the Global Solutions Initiative, the Aapti Institute, Data Privacy Brasil, and the Equiano Institute, the policy brief “Catalysing Positive Digital Infrastructure Innovation: G20’s Role in Advancing Data Agency” feeds directly into the T20 Communiqué, a collection of high-impact recommendations for the G20 by the task forces, published during the T20 summit.

On November 13, 2025, the Project Liberty Institute (PLI), in collaboration with its strategic partners ReframeVenture, Omidyar Network and ImpactVC, convened one of the most significant investor gatherings to date on the future of responsible investment in artificial intelligence and data technologies. Held at Stanford University in Palo Alto, the Stanford Summit Responsible Investment in Data & AI brought together a powerful cross-section of leading technologists and the investment ecosystem, including leading limited partners (LPs) and venture capitalists (VCs) representing more than four trillion [$] in capital across the United States and Canada.

The event created a rare forum for asset owners, allocators, and governance leaders to discuss how capital can shape AI technologies in ways that advance human agency, uphold democratic values, and strengthen long-term market trust.

A new partnership to shape the future of responsible technology investment and digital infrastructure

On the occasion of the Principles for Responsible Investment (PRI) in Person 2025 conference — one of the world’s foremost UN-backed gatherings of investors representing more than $120 trillion in assets committed to responsible finance — the United Nations Human Rights B-Tech Project and the Project Liberty Institute announced a new partnership to provide a vision for responsible AI investment that does not undermine data agency. The announcement, made during an official side event to PRI in Person in Sao Paulo, comes at a pivotal moment, as responsible investment frameworks expand beyond their roots in climate to address the growing human rights challenges associated with AI and data governance.

The event also marks the release of a new paper, “The Investors Financing the AI Ecosystem: Roles and Leverage to Drive Responsible Innovation,” jointly authored by UN B-Tech and the Project Liberty Institute. The publication explores how investors can use their influence to align capital allocation with human rights and unlock greater long-term value creation in the process.

As part of a global initiative to advance responsible and impactful investment in AI, the Project Liberty Institute (PLI) deepened its engagement with Asian investors through a series of high-level meetings and events across Singapore and Japan this October.

Building on the work in 2024 with strategic partners ReframeVenture, Omidyar Network, and ImpactVC, these engagements aimed to broaden the Institute’s ongoing LP and VC processes on responsible AI and data investment—an initiative that has already involved investors with over $6 trillion in capital across Europe and North America.

PLI’s CEO Sheila Warren emphasized “ASEAN, and Southeast Asia more broadly, are an innovation powerhouse—home to extraordinary entrepreneurial energy and forward-looking investors. For decades, the region has been ahead of the curve when it comes to the adoption of frontier technologies, and it is uniquely positioned to help shape an AI era that upholds individual agency and inspires human-centered business models. As such, this is a crucial region for PLI’s mission to recenter humanity in the global digital economy.”

Pictured Olivier Clyti, Director of Strategy, CSR, Digital, InVivo, France, Giuseppe Guerini, President, Cooperatives Europe, Italy, J.Benoit Caron, General Director of the Consortium for Collective Enterprise Cooperation, Canada, Osamu Nakano, Vice Executive Director, Japan Workers’ Co-operative Union (JWCU), Japan

On October 27th and 28th, the Project Liberty Institute presented the findings from “How Can Data Cooperatives Help Build a Fair Data Economy? Laying the Groundwork for a Scalable Alternative to the Centralized Digital Economy,” at the Global Innovation Coop Summit.